Hi I'm Jimmy and this video I'm going to look at three marijuana stocks that I think are
interesting to watch that are either profitable or going to be profitable very soon.
Now I'm not paying attention to whether or not these marijuana stocks are a good deal
or they're trading at a good value.
I'm simply looking at the potential of being profitable.
I figure that most marijuana stocks are way overvalued anyways.
But if we wanted to invest in marijuana stocks for the long run.
To me it makes sense to focus on companies that are profitable or heading into profitability
soon.
Then they have the ability in theory to keep growing.
Another possibility would be to focus on marijuana stocks that have the potential to get bought
out and each of these companies could easily fall into the buyout target category.
But buyouts are often more of a strategic decision.
So while that could happen that's not where I'm focusing with this video.
Okay so now let's get started.
So our first marijuana stock is called Pyxus international Pyxus trades under the ticker
symbol PYX in the United States.
Now it makes Pyxus International Interesting is that they've actually been in business
for a long time and they've been a producer up until this point.
They've been a producer of tobacco plants and they've been doing it for many years.
Now they're switching at least some of their focus over to cannabis.
And to me this is really smart because the tobacco industry has been struggling lately
while the cannabis industry as we all know has been exploding.
So this is a turn of revenue for Pyxus going back the past few years.
And as we could see revenue has been declining.
And then last year in 2018 that's when they first started announcing their transition
from tobacco over to cannabis.
Then when we switch over to net income what we can see that they were profitable last
year and again in 2016.
Now I actually expect them not to be profitable in 2019 as they're going to have to pay a
decent amount of money or this amount of expenses related to making the switch from tobacco
to cannabis.
But I would expect it to be profitable again in 2020.
So what I like about Pyxus' stock is that it's the management team.
This is a seasoned team in this type of business.
So whether they're growing tobacco or cannabis I would think they could do either fairly
effectively.
Either way I think that this a longer term play.
And since I think the cannabis industry has more potential for growth I would think that
this management team could do well in the long run.
OK so for the next marijuana stock that has actually been a longer term favorite of mine
for a while that is Organigram.
Now their primary tickers OGI.
They're listed on the Canadian exchange then they have a US version of it that ticker in
trade that trades in the US is OGRMF and then I believe in Germany they're listed under
OOG.
Now my last video on marijuana stocks that I liked actually had Organigram on that list
and this is a chart of Organigram stock over the past year and this is where we did our
last video where we talked about Organigram stock being a good investment and it's done
fairly well.
It's up a bit over 50 percent since we did that video but now the question is do we think
it'll will keep moving higher.
So here's a chart of revenue and as we could see revenue is expected to see huge jumps
in the coming years.
The green bars are analyst expectations and it's actually brings us to a different point.
So Organigram has a market cap of about one point five billion dollars while Pyxus has
a market cap of a bit under 180 million or so.
So that's why we have analyst expectations for OGI stock and we don't have them for Pyxus
since analysts tend to cover larger companies.
So when we switch over net income what we can see that although Organigram was profitable
in 2018 analysts are expecting for them to have significantly more profits in the coming
years.
So assuming the industry continues to roar that should help their stock.
So what I like about Organigram is that they have one of the lowest costs of production
in the cannabis industry which means that they're going to have better than average
margins and they're ramping up that production right now they're producing almost 50000 kilograms
a year and that's expected to be in the range of about one hundred and fifteen thousand
kilograms by the end of this year plus another working on deals with CBD beverage products
which I think have big potential in the coming years.
So overall I'm a big fan of Organigram.
OK.
Up next for marijuana stocks we have innovative industrial properties ticker symbol IIPR so
IIPR has a market cap of less than five and a million dollars but they're profitable.
This is a chart of both revenue and profits side by side.
And the reason that I'm showing this side by side is that so we can see how close profits
are to revenue but what makes this particular marijuana stock unique is that IIPR is a real
estate company.
So I like the concept of IIPR as a unique way to play the marijuana stock market without
the same risk since in theory a real estate company should be much safer than an actual
producer or distributor of cannabis product and that was actually one of the reasons that
I went with IIPR stock as the number three pick because I thought that this could help
diversify a decent marijuana portfolio.
And as I said in my video where I talked about what I believed the future of marijuana stocks
would eventually be.
And that is that eventually they're all going to get priced like most other stocks do based
on profits.
Well I thought that it made sense to put together a list of companies that that are profitable
and are either profitable now or will be profitable soon.
So it also made sense for me once I came across a real estate company that competed in the
same space.
Well I thought it made more sense to include a company like this as it offered more choices
for marijuana investors.
So those are the three marijuana stocks that I think are worth watching that are already
profitable or are close to becoming profitable.
And I'm curious which companies you are watching.
Marijuana stocks that are already profitable or close to it.
I wanted to include companies some of the classic marijuana stock companies like Aphria
or Aurora.
Since I think that those companies have a pretty good chance of getting acquired and
that has potential for some huge upside for marijuana stock investors but they're not
profitable yet.
So I don't want to include them in this video but what do you think.
Which marijuana stocks that I didn't include here do you think I have the best chance of
being profitable soon let me know what you think in the comments below.
Thank you for stick with me all the way to the end of the video.
They haven't done so yet hit subscribe hit the thumbs up and I'll see in the next video.